Sustainability Report 2018 - Responsibility for tomorrow - Schaeffler
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Sustainability Report 2018 Responsibility for tomorrow
Schaeffler Group | Sustainability Report 2018 CONTENTS
Contents
Dashboard sustainability 1
Message from the shareholders 2
Introduction by the Chief Executive Officer 4
Magazine 3 Customers and products
Sustainable management 7 3.1 S
ustainable products and 34
Responsibility with conviction technologies
3.2 Customer relationships 38
Customers and products 11
Creating added value together 3.3 Quality management 39
Environment and energy
4
15
Looking ahead
Employees and society 19 Environment and energy
The basis of our success
4.1 Energy management and emissions 42
4.2 Environmental management 43
4.3 Material and resource management 44
4.4 Logistics 46
1 Strategy and
sustainability management 5 Employees and society
1.1 Corporate strategy and values 24 5.1 E
mployee advancement and 49
1.2 Understanding of sustainability 25 development
1.3 M
ateriality and stakeholder 25 5.2 Occupational health and safety 52
management 5.3 Diversity 54
1.4 Controlling sustainability 27 5.4 Compensation and retirement benefits 55
5.5 Work-life balance 56
5.6 Corporate citizenship 57
2 Sustainable management 6 Appendix
2.1 Corporate governance 29 6.1 Key figures on sustainability 61
2.2 R
esponsibility in the supply chain 31 6.2 GNFK index and GRI content index 64
and human rights due diligence
6.3 Sustainability Roadmap 65
6.4 Report profile 71
Contact information/Imprint 72
Schaeffler Group | Sustainability Report 2018 SUSTAINABILITY DASHBOARD 1
Dashboard
Sustainability
Sustainable
management
1,997
2,581
3,060
881 Million 94.3%
2016 2017 2018
Response rate of suppliers
Shareholders' equity1) 2) Net income3) surveyed on the use
in EUR millions in EUR of conflict minerals4) 5)
Customers and
products
2,316 2,383 2,417
7,991 100%
2016 2017 2018
Successful R&D employees7) Coverage rate of
patent registrations6) quality management systems8)
Environment and
energy
83.7% 85.2% 85.8%
3,367 GWh 88.7%
2016 2017 2018
Coverage rate of Total energy consumption10) Coverage rate of
ISO 50001 certification9) ISO 14001 certification9)
Employees and
society
86,662 90,151 92,478
13.2% 88.7%
2016 2017 2018
Number of employees, Proportion of Coverage rate of
total female managers11) OHSAS 18001/ISO 450019)
A complete overview of all key figures on sustainability is shown on Page 61 et seq.
1) Including noncontrolling interests. 2) Retrospective adjustment of the 2017 figure due to a change in the accounting for income tax benefits. See explanatory information in the annual report
2018 in the Appendix Note 1.4 Method change IAS 8. 3) Attributable to shareholders of the parent company. 4) Response rate of relevant suppliers surveyed on the use of conflict minerals as
defined under the Responsible Minerals Initiative. 5) Survey period from March to February of the following year. 6) Patent registrations concern first filings filed with the German Patent and
Trademark Office. 7) The values reflect the workforce headcount at the end of the year. The figures for 2016 and 2017, which were based on average values in the 2017 sustainability report,
were subsequently converted to headcount at the end of the year. 8) According to the scope of the Schaeffler Group's management manual and valid certification rules. 9) Relating to employees.
10) Energy sources included: Electricity, natural gas, district heating, propane, fuel oil, without the amount of electricity produced by the gas-powered CHP. 11) “Managers” are defined as
employees in a supervisory function.
Schaeffler Group | Sustainability Report 2018 MESSAGE FROM THE SHAREHOLDERS 2
Schaeffler Group | Sustainability Report 2018 MESSAGE FROM THE SHAREHOLDERS 3 As a global technology company, the Schaeffler Group is actively shaping the far-reaching transformation of mobility and energy systems sustainably, innovatively, excellently, and passionately. These core values have always given our family business a foothold and also give us a basis and orientation for responsible corporate governance in turbulent times. For us, responsibility means keeping the company on course in the face of dynamic market developments, continuing to grow profitably, securing jobs, and at the same time being environmentally friendly. Our role as family shareholders is to create the conditions for this – economically as well as idealistically. We are currently seeing how mobility needs and demands are changing worldwide. That means that we too will have to change and stay in constant motion. We are doing this with determination. The Schaeffler Group has the expertise and experience to continue sustainably helping its customers – automobile manufacturers and industrial companies in other industries – succeed with innovative, excellent products and solutions in their markets. To this end, we consistently invest in new technologies and the highest quality from the component to the complete system to service. In this way, Schaeffler will contribute to making the mobility of tomorrow more climate-friendly, safer and more efficient for everyone involved. Against this background, in our supervisory role we are primarily responsible for ensuring that future- oriented corporate decisions are made while keeping risks manageable. Therefore, in addition to organic growth, we are also focusing on targeted acquisitions in order to expand our systems expertise. An example of the Schaeffler Group's outstanding innovative drive is the number of patent registrations that increased once again: In 2018, the group registered 2,417 patents. Our diverse innovations in eco- friendly drives or in the energy chain are honored by our customers with numerous awards. We also place high demands on our own processes and those of our suppliers. We are committed to ethical principles and ensure that they are lived throughout the company and in our supply chain. We train our employees worldwide in handling the Schaeffler codes of conduct both digitally and directly on site with proven compliance experts. In addition, we comply with demanding environmental and social standards. For example, all Chinese production sites have now achieved certification according to the new ISO standard 45001 for occupational safety. Purchasers at our Chinese sites have also begun to establish new, comprehensive standards for supplier audits on environmental, human, and labor rights. We offer our employees attractive working conditions and diverse development opportunities worldwide because we know that the sustainable success of the Schaeffler Group depends on the skill and creativity of each individual. We would also like to express our great appreciation to you, the employees of the Schaeffler Group, for your commitment and your contributions. Together, we will continue to create added value for you and for all our stakeholders in the future. We hope you enjoy reading our sustainability report. Maria-Elisabeth Schaeffler-Thumann Georg F. W. Schaeffler
Schaeffler Group | Sustainability Report 2018 INTRODUCTION
MESSAGE
BY THEFROM
CHIEFTHE
EXECUTIVE
SHAREHOLDERS
OFFICER 4
Schaeffler Group | Sustainability Report 2018 INTRODUCTION BY THE CHIEF EXECUTIVE OFFICER 5 Growing profitably and creating value sustainably – this is our overarching goal. To achieve this goal, we have developed the strategy “Mobility for tomorrow” and the program for the future “Agenda 4 plus One”. Our strategy and the program for the future are based on our four company values: “Sustainable”, “Innovative”, “Excellent”, and “Passionate”. Despite the difficult market and competitive environment in 2018, we have made good progress in implementing our strategy. At the same time, we were able to make progress in key fields of action of sustainable development. Successful product innovations in the areas of mobility and industrial processes prove the effectiveness of our corporate strategy “Mobility for tomorrow”. In order to remain the innovation leader in the future, we invested more than ever before in research and development with EUR 847 m in 2018. We have purposefully created more scope for embracing technologies with future potential. For example, in 2018 another competence center for E-Mobility was created at the site in Bühl. Groupwide revenues in this area increased from EUR 416 m in 2017 to EUR 486 m in 2018. We are once again making progress in the sustainable design of our locations and processes. The introduction of certified environmental management systems at our production sites is almost complete and the accident rate has dropped by over ten percentage points once again – just to name these two aspects. Our goals remain ambitious: We are committed to making climate-friendly mobility possible all over the world with innovative and technologically excellent products and contributing to greater energy efficiency wherever people, goods and energy are transported or machines are operated. The focus is on the four target areas of environmentally friendly drives, urban and interurban mobility, and the energy chain. At the same time, we intend to manage the internal company activities to protect the environment and the climate even more effectively in the future. We are consistently working to further reduce energy consumption and greenhouse gas emissions and are also implementing the program for the future “Agenda 4 plus One”. It includes 20 initiatives to advance the Schaeffler Group's transformation. One of the highlights is the “Factory for Tomorrow” initiative. Numerous technological innovations are being tested and optimized so that the sustainable factory of tomorrow will soon become a reality. Another focus is on sustainability in the supply chain. We require our suppliers to comply with the requirements of the Schaeffler Group Corporate Supplier Code of Conduct and continually develop the tools we use to ensure this. Many of our decisions in Group management have a global impact. Therefore, we are committed to the principles of the UN Global Compact, the National Action Plan on Business and Human Rights, and the goals of the United Nations 2030 Agenda for Sustainable Development. With the Schaeffler Group's opportunities and skills, we can make a significant contribution to making the world a bit cleaner, safer, and smarter. In order to anchor our commitment to sustainability even more strongly and to send a clear signal both internally and externally, sustainability management will be strengthened and realigned organizationally in 2019 with a direct reporting line to the Chief Human Resources Officer.
Schaeffler Group | Sustainability Report 2018 INTRODUCTION BY THE CHIEF EXECUTIVE OFFICER 6
Beyond the legal requirements, we are publishing this comprehensive, voluntary sustainability report
in order to clearly explain where we stand with regard to our sustainability performance and how we intend
to continue to move forward. Under the slogan “Making progress visible”, we provide information about
our past and planned business activities and their effects on the environment, people, and markets.
Our progress is primarily thanks to the knowledge and dedication of our employees. On behalf of myself
and my Executive Board colleagues, I would like to thank you for your personal commitment.
We hope you find reading our current sustainability report both informative and interesting.
Yours sincerely,
Klaus Rosenfeld
Chief Executive Officer of Schaeffler AG
Corinna Schittenhelm Matthias Zink Michael Söding
Chief Human Resources Officer CEO Automotive OEM CEO Automotive Aftermarket
Dr. Stefan Spindler Prof. Dr.-Ing. Peter Gutzmer Dietmar Heinrich
CEO Industrial Deputy Chief Executive Officer and Chief Financial Officer
Chief Technology Officer
Andreas Schick Helmut Bode Bruce Warmbold
Chief Operating Officer Regional CEO Asia/Pacific Regional CEO Americas
Dr. Yilin Zhang Jürgen Ziegler
Regional CEO Greater China Regional CEO Europe
Schaeffler Group | Sustainability Report 2018 MAGAZINE 7
Sustainable management
RESPON-
SIBILITY
WITH CON-
VICTION.
We act responsibly – w
ithin
the company and along the
supply chain.
Integrity, fairness and mutual
respect – these are the values that Around
32,000
our corporate activity is based on.
We take our responsibility seriously
and act in accordance with the law and
regulations at all times. In so doing,
we create the foundation for sustainable suppliers from 82 countries carried out
corporate success. work for the Schaeffler Group in 2018.
Schaeffler Group | Sustainability Report 2018 MAGAZINE 8
Sustainable management
94.3% Response rate of surveyed
suppliers on the use of conflict
minerals1) 2)
2018 Schaeffler tracks the regions from
which subcontractors purchase
components containing critical raw
materials in order to initiate targeted
measures in the supply chain where
appropriate.
91.2%
2017 Where we stand
We asked the project managers for
their subjective assessment:
88.0% 1 How satisfied are the
employees in India with
the combined compliance
2016 training concept?
1) Response rate of relevant suppliers surveyed on the use of conflict minerals as defined under
the Responsible Minerals Initiative.
2) Survey period from March to February of the following year.
Worldwide responsibility
The Schaeffler Group expects integrity and law-abiding behavior from
all employees and executives. We clearly express these requirements in
our Code of Conduct. The requirements are not only aimed at our own
organization, but also at our suppliers.
As an international automotive and industrial supplier, we work with a 2 How far along is the
first pilot of a global
audit standard?
globally branched supply chain. Making this supply chain responsible
in terms of human rights and environmental and social aspects is
part of our sustainable corporate leadership. In our Supplier Code of
Conduct, which every new supplier has to sign, we have stipulated
the corresponding requirements. In addition, we subject potential
suppliers to a systematic selection process in which sustainability
aspects are also questioned.
You can find more on these topics under “Sustainable management”
on Page 28 et seq.
More information on Page 9 et seq.Schaeffler Group | Sustainability Report 2018 MAGAZINE 9
Sustainable management
How we are creating a sustainable compliance culture.
How do I put the requirements of the Schaeffler Code of Conduct
into practice in my everyday activities? We support our employees
by offering practical training. The training includes realistic
situations based on concrete case studies.
Perfect combination
We complement our online compliance foundation
training with individual face-to-face sessions. This lets
us use the advantages of both methods and ensure
long-term learning success.
Total participants3) in compliance training
in 2018
Face-to-face
training 18,371 E-learning
8,793 9,578
“We have created a culture
of compliance in which
our employees are actively
involved. Our training is
continually adapted to new Participants in compliance training
in India
requirements.”
Abhay Jhina,
Regional Compliance Officer India
Our compliance training method
Face-to-face
combines e-learning with face-to-face
training. The foundation training on our
training 677 E-learning
Code of Conduct, which is obligatory for 316 361
all employees, takes place online and is
available in 14 languages. “This raises
awareness of compliance issues. But
that alone is not enough,” states Abhay
Jhina. “In face-to-face training, we can
answer individual questions flexibly, 3) Employees incl. temporary staff, apprentices, interns, and contract workers.
personally and effectively.”Schaeffler Group | Sustainability Report 2018 MAGAZINE 10
Sustainable management
How we promote sustainability standards
across the supply chain.
We are taking the initiative in China and have launched a pilot
project to outline a new global standard for supplier audits. The aim
is to ensure that human rights, safe working conditions, and strict
environmental laws and regulations have been adhered to.
Extensive audits
In 2018, we audited around one tenth of all suppliers
based in China as part of an obligatory EHS audit.
These audits covered environmental, health, and
occupational safety aspects.
Suppliers based in China
1,925
“It is our duty to audit our
supply chain thoroughly
according to sustainability
criteria. We are facing a
1,617 308
challenging situation in China Suppliers of nonproduction Suppliers of production
at the moment.” materials materials
Yan Chen,
Director Supplier Quality Management,
Purchasing, Schaeffler Greater China
In 2017, environmental laws and regulations
became much stricter for companies in China.
“We have expanded the scope of our supplier
audits as a result of these changes,” Yan Chen
198 4
reports. “But, for us, it is not enough simply Suppliers audited on Audits planned as
to check environmental aspects.” Yan Chen’s environmental and part of pilot project
team also expanded the audit log to include occupational health and in 2019
the industry-specific social requirements of safety topics in 2018 in China
the German Association of the Automotive
Industry (VDA), for example, in relation to
working conditions.
You can find more on this topic in the online report at:
www.schaeffler-sustainability-report.com/2018Schaeffler Group | Sustainability Report 2018 MAGAZINE 11
Customers and products
CREATING
ADDED
VALUE TO-
GETHER.
Together with our
customers, we are
designing the mobility
of the future.
Megatrends such as climate change, Around
2,400
globalization, urbanization, and
digitalization present major challenges
for us and our customers. We are
transforming these challenges
into tomorrow's opportunities with patents were submitted by us to the German
innovative technical solutions. Patent and Trade Mark Office in 2018.Schaeffler Group | Sustainability Report 2018 MAGAZINE 12
Customers and products
EUR 847 m Research and
development expenses
As a forward-looking company, we
2018 invest in research and development.
Around 7,900 employees worldwide
work on innovative solutions at
20 research and development centers.
EUR 846 m
Where we stand
We asked the project managers
for their subjective assessment:
2017
1 How much of the business
potential in wind power
has Schaeffler already
exploited?
EUR 751 m
2016
Closeness to customers as a success factor 2 How good is the feedback
from the repair shops using
the REPXPERT service?
Our products enable sustainable mobility. We develop drive systems,
intelligent components, and solutions to generate renewable energy.
The key factor for our innovative strength has always been the close
relationship with our customers. Only those who recognize and under-
stand the challenges of their customers at an early stage can develop
solutions that are also tailored to their future needs.
ou can find more on these topics under “Customers and products”
Y
on Page 33 et seq.
More information on Page 13 et seq.Schaeffler Group | Sustainability Report 2018 MAGAZINE 13
Customers and products
What we are doing for efficiency in wind power.
We follow a holistic approach: To make the mobility of tomorrow
more sustainable, we are thinking of the entire process chain
from energy generation to vehicle propulsion – starting with the
generation of renewable energy.
Better performance – even in bearings
Every year, the installed capacity of wind
turbines worldwide grows by around 10 percent.
Schaeffler supplies increasingly efficient technical
storage solutions for them.
Total installed capacity
of wind turbines worldwide
470 GW 515 GW 565 GW
“We are evolving from a pure
component supplier to a
system supplier. Our Industry
4.0 solutions ensure optimal
operation of wind turbines.”
Rudolf Walter,
Vice President Regional Business Unit
Wind Europe
“Our customers face tough global
competition,” says Rudolf Walter. “In order
to reduce their electricity generation
costs, they strive to reduce downtime and
increase the number of operating hours.”
Schaeffler develops reliable, durable
products for more economical plant operation.
“With Industry 4.0 solutions,” he adds,
“we can further increase the reliability of
our components and break new ground in 2016 2017 2018
terms of operational management.”Schaeffler Group | Sustainability Report 2018 MAGAZINE 14
Customers and products
How we contribute to our customers’ success.
In workshops around the world, mechanics carry out vehicle
repairs with Schaeffler replacement parts every day. In view
of the rapid technical development and more complex vehicle
applications, this task is becoming increasingly demanding.
Our services
We offer a variety of services related to our products
and repair solutions on the online REPXPERT platform.
Garages benefit from our more than 40 years of experience
in the automotive replacement parts business.
> 500,000
Visits to the REPXPERT online platform
every month
“We help workshops carry
out repairs efficiently and > 116,300
with lasting success. We are Registered workshops worldwide
available for them at any
time on REPXPERT.com.”
~ 55,000
Ralf Kuhlmey,
Team Leader Technical Training &
Technical Field Service
Training participants in 2018
Be it an independent or authorized
workshop,garages around the world should
always receive the best possible assistance
for repairing vehicles. That's why Schaeffler
23
developed the digital platform REPXPERT.
The platform offers professionals guides,
video tutorials, product brochures, and
service information, but also a personal Country versions available in 12 languages
link to our experts. “On REPXPERT, you
can also book on-site training with around
70 instructors like me,” says Ralf Kuhlmey.
You can find more on this topic in the online report at:
www.schaeffler-sustainability-report.com/2018Schaeffler Group | Sustainability Report 2018 MAGAZINE 15
Environment and energy
LOOKING
AHEAD.
Climate and environmental
protection begins in the
company.
21
Being a pioneer – we pursue this goal
not only with our products, but also with
environmentally friendly, energy and
resource-efficient production processes.
An ambitious environmental and energy “Sustainable Factory” subprojects were
launched as part of the “Factory for
policy that is harmonized worldwide Tomorrow” initiative within the program
creates the basis for this. for the future “Agenda 4 plus One”.Schaeffler Group | Sustainability Report 2018 MAGAZINE 16
Environment and energy
85.8% Coverage rate of production
sites with energy management
certification ISO 500011)
2018 We control our activities with
company-wide energy and
environmental management systems.
Their implementation is audited by
independent experts.
85.2% Where we stand
2017
We asked the project managers
for their subjective assessment:
1 How far along is the pilot testing
of the CO2-neutral factory?
83.7%
2016
1) Relating to employees
Our goal: the sustainable factory
We are constantly working on improving our production processes,
for example through systematic energy management, using resource
2
and material-saving technologies, or avoiding respectively recycling How much of the potential
production waste. With the concept of the “Sustainable Factory”, we of 3D printing technology
are pursuing a holistic approach. For example, manufacturing and has Schaeffler already
logistics processes are digitalized so that machines and processes can exploited?
be controlled centrally and optimized with regard to their efficiency.
The approach also includes sustainability standards for procuring
production machinery and constructing new buildings.
Last but not least, the needs of our employees are also taken into
account. The architecture and the equipment of the “Factory for
Tomorrow” support flexible work processes and encourage personal
interaction.
ou can find more on these topics under “Environment and energy”
Y
on Page 41 et seq.
More information on Page 17 et seq.Schaeffler Group | Sustainability Report 2018 MAGAZINE 17
Environment and energy
How we achieve a carbon-neutral energy supply.
Delivery, temporary storage and distribution under one roof – the
central goods receiving area in Herzogenaurach is ideally suited as
a pilot project for sustainable energy production, storage, and use.
All processes will run around the clock with solar energy in the future.
67 t CO2/year
Fewer CO2 emissions: In the future, all
needs will be met with electricity from
CO2-neutral photovoltaic systems,
including hydrogen production for heat.
Excess hydrogen will be used to refuel
hydrogen-powered vehicles.
204,242 kWh
“Our product innovations are used by the goods receiving area in
Herzogenaurach each year.
are not only an asset for our
customers. Thanks to our
new power storage, we want
to supply the ‘Sustainable
Factory’ steadily with green
electricity.”
Christian Adler,
380,000 kWh
of renewable energy will be supplied by
Corporate Factory Planning,
the planned system.
Head of Workstream Sustainable Factory
A solar energy system will be built on the
roof of the goods receiving area. It will cover
the energy needs of the building and also
provide power for charging stations and for
producing hydrogen for fuel cells. “In order
for the electricity to flow even when the sun
is not shining, we rely on scalable storage
technology from a joint venture,” explains
45,000 kWh
Adler. This technology is based on renewable of excess energy can be used for refueling
raw materials and is about to be ready for electric vehicles, among other things.
the market.Schaeffler Group | Sustainability Report 2018 MAGAZINE 18
Environment and energy
How we use less through 3D printing.
High-quality components from the laser printer? Additive manufacturing –
also called 3D printing – is what processes are called in which workpieces
are no longer machined out of a solid block, but rather built up layer by
layer from a powdery raw material among other things.
Additive methods have an advantage
The so-called “double comb cage” is a cylindrical hollow
body that is used in roller bearings. Using additive methods
saves 14.5 kg of material for the blank.
Material efficiency
using the example of a double comb cage
10 kg
Blank
Additive method
“The potential of additive
manufacturing is far from
exhausted. When used
5 kg
properly, we can achieve Finished component
significant material, cost,
and time savings.” Conventional method
Ruslana Mys,
Development Production Technology
Specialist
Every year, Schaeffler produces around
5,000 parts in Herzogenaurach via additive
manufacturing – and the trend is increasing.
24.5 kg
“Not only representative samples are
Blank
produced in this way, but also high-quality
prototypes and tools for series production,”
reports Mys. In 2015, we established our
own additive manufacturing department and
are constantly developing new application
possibilities.Schaeffler Group | Sustainability Report 2018 MAGAZINE 19
Employees and society
THE BASIS
OF OUR
SUCCESS.
We are responsible for
our employees.
92,478
We want to attract the best employees,
support them, and retain them in the
long term. As a family business, we have
always been committed to the well-being
of our employees. It starts with creating people were employed by us worldwide
a safe and healthy work environment. at the end of 2018Schaeffler Group | Sustainability Report 2018 MAGAZINE 20
Employees and society
3.5%
14.0%
Distribution of employees
by region in 2018
The distribution of employees across
14.2% 68.3% the Schaeffler regions remains largely
constant. The focus remains on Europe.
Europe Americas Greater China Asia/Pacific
The regions represent the regional structure of the Schaeffler Group.
Proportion of employees by age group in 2018 Where we stand
The age distribution in the workforce corresponds to the trend towards We asked the project managers
an aging society. However, the proportion of under-20-year-olds has for their subjective assessment:
grown significantly.
Age Employees
< 30
21.0%
14.5% 1 How far along is
Schaeffler on the way to
an agile organization?
55.3%
30-49
52.4%
23.7%
≥50
33.2%
Employees worldwide (total: 92,478)
Employees in Germany (total: 32,702)
2 How good is the response
to the Schaeffler health
portal?
Ready for the future
In the face of rapid technological progress and ever shorter innovation
cycles, today's knowledge is already outdated tomorrow. A core element
of our human resources work is therefore to create a culture of lifelong
learning. We want to prepare our employees in the best possible way
for the demands of the future. In doing so, we rely on modern learning
formats and new methods such as agile project management.
You can find more on these topics under “Employees and society”
on Page 48 et seq.
More information on Page 21 et seq.Schaeffler Group | Sustainability Report 2018 MAGAZINE 21
Employees and society
How we are shaping the agile transformation.
Our market environment is undergoing a fundamental change.
The complexity and pace of change require that we always
adapt flexibly to new situations. Agile work helps with this.
Positive feedback
Thanks to the very high demand and positive
feedback, the training opportunities will be further
developed in 2019. Over 500 employees will pursue
further qualifications in 50 different target-group
oriented trainings.
4.5/5
average training assessment
in 2018
“Agile work increases the
satisfaction of our customers
150
employees trained
because we keep a better
eye on their needs. At the
same time, the employees’
15
mindset changes.”
Marta Danilewicz,
Head of Corporate Project
agile coaches and
Management Office
Whether a methodology toolbox, training,
or individual coaching, we offer numerous
opportunities to learn about agile working
35
methods as part of the training programs
in our Schaeffler Academy. “It's not just
about teaching a new method, but about
initiating a real cultural change,” says
Marta Danilewicz. “Our executives play scrum masters passed on their knowledge
a key role in this. That's why we offer
special training for them.”
You can find more on this topic in the online report at:
www.schaeffler-sustainability-report.com/2018Schaeffler Group | Sustainability Report 2018 MAGAZINE 22
Employees and society
How we are using digital media for the health
of our employees.
We want to promote the health of our employees. The unique Schaeffler
Health Coach online health portal offers extensive information and
courses on healthy nutrition and physical and mental fitness.
Successful start
Since the start of the Schaeffler Health Coach in
December 2018, the service has been well received by
the employees. By March 2019, 10 percent of the German
workforce had already registered.
3,697
number of registered users
in March 2019
“The health portal is
accessible to all employees
through an app, but the portal
is even available outside of
20%
of the German workforce is the target
working hours on a private by the end of 2019
computer or smartphone.”
Anja Buschner,
Responsible for workplace
health management
The Schaeffler Health Coach was developed
in cooperation with Barmer health
1,300
insurance. Regional fitness and health
offers can be booked online. “Employees
can each choose a particular topic on which
they then receive weekly informational
videos,” reports Buschner. In 2019, the videos available
portal will be expanded to include a (800 when introduced)
telemedicine service. Employees can get
medical advice by phone around the clock.
You can find more on this topic in the online report at:
www.schaeffler-sustainability-report.com/2018Schaeffler Group | Sustainability Report 2018 STRATEGY AND SUSTAINABILITY MANAGEMENT 23
1 Strategy and sustainability management
The Schaeffler Group is a publicly listed family business with a strong
foundation in its values that shapes its corporate culture and entrepreneurial
activity. Economic success, long-term orientation, and awareness of the social
and environmental concerns of its own business are traditionally inseparably
interlinked at Schaeffler. These values are the compass that sets the company's
course for the future and implements the strategy “Mobility for tomorrow”.
CONTENTS Schaeffler aspires to have a positive influence outside of
the company on global economic, social, and ecological
1.1 Corporate strategy and values 24 development. Schaeffler contributes to ten of the United
Nations Sustainable Development Goals (SDGs) with its
1.2 Understanding of sustainability 25 activities.
1.3 M
ateriality and stakeholder management 25
1.4 Controlling sustainability 27
SDG overview in the online report:
www.schaeffler-sustainability-report.com/2018Schaeffler Group | Sustainability Report 2018 STRATEGY AND SUSTAINABILITY MANAGEMENT 24
1.1 Corporate strategy and values
1.1 Corporate strategy and values The Schaeffler Group’s vision and mission complement
and amplify one another, with the vision encompassing the
Climate change, urbanization, globalization, and goals and aspirations that will guide its future course of
digitalization are megatrends that are changing action.
life and work around the world at great speed.
“As a leader in technology, we combine a passion for
This is particularly evident in mobility. Whether innovation with the highest standards of quality to shape
within cities, on the major transportation the future of mobility – for a world that will be cleaner,
routes that connect them, or in the industrial safer, and smarter.”
sector, mobility is being redefined everywhere.
With the strategy of “Mobility for tomorrow”, Schaeffler is
Schaeffler is actively shaping these changes.
setting the foundation for sustainably profitable growth
from now on. Based on the assumptions about the
megatrends mentioned above, the company has defined
Corporate strategy “Mobility for tomorrow” four target areas:
In its mission, the Schaeffler Group describes the task to • Eco-friendly drives
which it is committed. • Urban mobility
• Interurban mobility
“Guided by the values of a global family business, we work • Energy chain
closely together with our customers as true partners to
deliver a compelling value proposition through our best-in- Building on this, the Schaeffler Group has developed
class expertise in manufacturing technology and systems eight strategic cornerstones that represent the concrete
know-how. In doing so, we contribute to the success of our framework of the ongoing further development of the
customers, the advancement of our employees, and the company. The implementation of the strategy “Mobility
prosperity of our society.” for tomorrow” will be ensured through the program for the
future “Agenda 4 plus One”, which includes 20 strategic
initiatives.
You can find more information about the strategy “Mobility
for tomorrow” in the annual report 2018, Page 26 et seq. and
in the sustainability report 2018 Page 34.
Mobility for tomorrow – 4 focus areas
Eco-friendly drives Urban mobility
Optimized Two-wheelers
combustion engine Inner-city railways
Electric cars Micro mobiles
Industrial drives
Mobility for
Interurban mobility
tomorrow Energy chain
Railway vehicles Wind power
Aircraft Solar power
Off-highway Conventional power
generationSchaeffler Group | Sustainability Report 2018 STRATEGY AND SUSTAINABILITY MANAGEMENT 25
1.2 Understanding of sustainability
Guiding values of a global family business The Schaeffler Group is committed to the principles of
the Global Compact and is guided by the requirements
Schaeffler feels especially connected to the company values and principles of the National Action Plan for Business
“Sustainable”, “Innovative”, “Excellent”, and “Passionate”. and Human Rights, the UK Modern Slavery Act, the German
These values are the basis of the continuing success of Sustainability Strategy and the objectives of the Paris
the Schaeffler Group in the interest of, and for the benefit Climate Change Agreement.
of, our customers, business partners, employees, and
our executives as well as our shareholders and family
shareholders. Codes of conduct
These frameworks are the basis for two Schaeffler Group
The Schaeffler Group's company values codes of conduct.
Sustainable Innovative
he Schaeffler Group Code of Conduct is available at
T
www.schaeffler.com/code-of-conduct
A long-term view and For (nearly) every problem
continuity will foster the there is a solution. If not,
he Schaeffler Group Supplier Code of Conduct is
T
growth of the Schaeffler we will create one!
available at www.schaeffler.com/supplier-code-of-conduct
Group, thereby enabling a
future worth living.
The codes contain binding ethical and legal principles for all
company employees or for all suppliers and their business
partners.
Excellent Passionate
GRI 102-12
We develop solutions that Our biggest driver is our
are of the highest quality passion for innovative
based on our extensive technologies and joint
expertise. success with our customers.
1.3 Materiality and stakeholder
management
GRI 102-16 | 102-26 | 102-27 | 102-29
UNGC 1-10 The basis for the selection of central fields
of action and the further development of the
Sustainability Roadmap is the Schaeffler Group's
materiality analysis. It was prepared in 2016
1.2 Understanding of sustainability together with key stakeholders in accordance
with the requirements of the Global Reporting
Guided by the company values, Schaeffler Initiative (GRI) and updated in June 2018 with
creates the conditions for long-term, profitable the involvement of the company's Executive
growth. In terms of the Schaeffler Group's Board.
understanding of sustainability, this means
being economically successful while at the same
time assuming responsibility for the environment In addition, a media and environment analysis was
and society. The United Nations’ 17 Sustainable conducted. Its results were taken into account in the final
derivation of the issues that are material to Schaeffler. The
Development Goals (SDGs) form the foundation
Schaeffler Group's materiality matrix, which was updated
of the company’s sustainability guidelines in accordingly for the reporting year, identifies 17 key issues.
particular.
Further information on the SDGs can be found in the online
report at www.schaeffler-sustainability-report.com/2018Schaeffler Group | Sustainability Report 2018 STRATEGY AND SUSTAINABILITY MANAGEMENT 26
1.3 Materiality and stakeholder management
The non-financial risks associated with the material topics
are collected and analyzed annually in line with the risk
management process. In 2018, the analysis revealed no
reportable risks in the reporting year in accordance with
17key issues were identified for the
CSR-RUG (Section 289c, paragraph 3 German Commercial Schaeffler Group in 2018.
Code (HGB)). The risk report in the Group management
report of the Schaeffler Group provides comprehensive
information about the company's risk management system
as well as significant risks that have a medium or high
negative impact on assets, finances or income. agencies, residents, associations, trade unions, investors
and analysts, universities, research institutes, and the
Further information on opportunity and risk reporting can be media.
found in the annual report 2018, Page 75 et seq.
Examples of successful stakeholder dialogs include
customer events like the Schaeffler Colloquium,
Stakeholder dialogs the Premium Supplier Days supplier event, and the
Through continuous interaction with the relevant industry-specific product safety days. In addition, the
stakeholder groups, the Schaeffler Group fosters various Schaeffler Group interacts with policymakers and is
dialog formats around the world on current and potential a member of various organizations, such as industry
future topics. and interest groups.
ou can find more on stakeholder groups and dialogue
Y complete overview of all memberships is available at
A
formats and topics in the online report. www.schaeffler.com/sustainability/memberships
www.schaeffler-sustainability-report.com/2018
Stakeholders’ demands on Schaeffler's sustainability
Schaeffler's key stakeholders include its customers, performance are constantly increasing. Against this
employees, suppliers, and service providers, as well as background, Schaeffler uses multipliers, such as rating
non-governmental organizations, politics and government platforms and rankings, to report transparently on progress
The Schaeffler Group's key topics
Employee advancement and development
high
Occupational health and safety
Sustainable products and technologies
Energy management
and emissions Customer relationships
Work-life balance
Stakeholder relevance
Compensation and retirement benefits
medium
Responsibility in supplier relationships
Corporate
citizenship Diversity
Compliance
Material and resource management
Sustainable management
Human rights
Environmental management
Customers and products
low
Data protection, information, and IT security Environment and energy
Employees and society
Logistics Quality management
low medium high
Company relevanceSchaeffler Group | Sustainability Report 2018 STRATEGY AND SUSTAINABILITY MANAGEMENT 27
1.4 Controlling sustainability
with regard to key topics. For example, the Schaeffler Group Monitoring objectives
has been active on the EcoVadis platform for sustainability
assessments in global supply chains since 2016. The goal Schaeffler monitors its objectives in the area of non-
of EcoVadis's assessment methodology is to evaluate the financial services on the basis of key figures. During the
quality of a corporate sustainability management system. year, key figures are collected on, e.g. environmental
In doing so, the corresponding guidelines, implementation concerns (including energy consumption, waste, green
measures, and results of the company are taken into house gas emissions), employee concerns (such as
consideration. accident rate and the proportion of women), social concerns
(customer satisfaction and quality), human rights, and
In 2018, the Schaeffler Group once again had its fighting corruption and bribery as part of standardized
sustainability performance evaluated by EcoVadis and processes.
achieved the Silver Recognition Level for the second time.
The overall result was improved by another ten points to In the 2018 fiscal year, 38 key figures were checked as part
60 out of 100 points (prior year: 50/100). of Limited Assurance for the separate non-financial report
(GNFK). They are published in the GNFK 2018. Further key
figures can be found in this Schaeffler Group sustainability
GRI 102-21 | 102-26 | 102-27 | 102-31 | 102-32 | 102-40 | report. The key figures are regularly and especially currently
102-42 | 102-43 | 102-44 | 102-46 | 102-47 | 413-1 checked for accuracy as part of the reorganization of the
UNGC 1 | 2 | 10 sustainability department.
he key figures and further information about them are
T
available in the online report
1.4 Controlling sustainability www.schaeffler-sustainability-report.com/2018
The Schaeffler Group is constantly working to
improve its sustainability performance. The Outlook
Head of Sustainability coordinates groupwide
Schaeffler has continued to develop its internal
sustainability activities and reports to the sustainability organization since January 1, 2019. For
Executive Board as a driving force. this purpose, a separate area, assigned to the Chief
Human Resources Officer, will be set up that will combine
responsibility for sustainability, environmental protection
The Steering Committee for Sustainability is a panel and occupational medicine and safety under new
of experts comprised of representatives of relevant management.
departments. It supports the head in the development of
strategic sustainability goals and metrics for assessing and With this step, Schaeffler is giving sustainability
managing the corresponding sustainability performance. management more weight and, with the involvement of
selected stakeholders, is reorienting its sustainability
The Sustainability Roadmap, which lists all strategic strategy. The adapted strategy will be presented in detail
sustainability goals and the measures and timelines for in the sustainability report 2019.
their implementation, was used as a work and process
monitoring tool for this purpose. The Roadmap is updated
and, if needed, adapted every year in cooperation with the GRI 102-19 | 102-20 | 102-30 | 102-31 | 102-33
responsible departments. It also contains cross-references
to show which SDGs are addressed with the corresponding ou can find more information about the Sustainability
Y
measures. Roadmap on Page 65 et seq.Schaeffler Group | Sustainability Report 2018 SUSTAINABLE MANAGEMENT 28
2 Sustainable management
For the Schaeffler Group, sustainability means to operate successfully in the
long-term in the interests of all its stakeholder groups and to create value for
its stakeholders such as employees, customers, business partners, and society
with the highest level of technological expertise. In addition, the Schaeffler
Group maintains management structures and processes that are designed to
ensure that all business activities comply with legal requirements and high
ethical standards at all times. This requirement for integrity explicitly applies to
the entire value chain.
Corporate security, data protection, and information and IT security
management are also designed to support the diligent and orderly conduct
of the business activities and its business partners and to prevent potential
damage.
CONTENTS With its activities and measures in the sustainable
management field of action, Schaeffler contributes to the
2.1 Corporate governance 29 SDGs “Sustainable economic growth and humane working
conditions for all” (SDG 8) as well as “Strengthening the
2.2 R
esponsibility in the supply chain and means of implementation and global partnerships” (SDG 17).
human rights due diligence 31
SDG overview in the online report:
www.schaeffler-sustainability-report.com/2018Schaeffler Group | Sustainability Report 2018 SUSTAINABLE MANAGEMENT 29
2.1 Corporate governance
2.1 Corporate governance Compliance
Schaeffler is committed to responsible corporate The compliance management system (CMS) is a part of the
governance. Central to this are an efficient Schaeffler Group's overall corporate governance structure.
Management and all employees are required by the Schaeffler
cooperation between the Executive Board and the
Code of Conduct (CoC) to comply with all applicable local,
Supervisory Board as well as open and transparent national, and international laws and regulations wherever the
corporate and financial communications as key Schaeffler Group conducts business. The entire worldwide
aspects of corporate governance. Fundamental compliance organization of the Schaeffler Group provides
corporate management decisions are aimed support in doing this. The Schaeffler Group’s CMS is based on
national and international standards. The concept of the CMS
towards long-term value creation.
was initially audited successfully by an independent auditing
firm in accordance with the IDW PS 980 auditing standard.
Responsible corporate governance In 2018, a second independent auditing firm confirmed the
adequacy and implementation of the Schaeffler Group's
The main focus of corporate governance is on trusting compliance management system.
customer relationships and acting with integrity. Business
dealings and relationships that are not compatible with the The purpose of the CMS is the prevention and early
company values of “Sustainable”, “Innovative”, “Excellent”, detection of legal violations in the areas of corruption,
and “Passionate” are rejected. The governance structure money laundering, competition, and antitrust law as well
of the Schaeffler Group supports this attitude and creates as economic crime. It also supports active risk control and
the necessary transparency in internal structures, the has a protective function for both the company and its
organization, and responsibilities. It also ensures that these employees. The Group Chief Compliance Officer manages
components work together in an organized manner. the compliance organization. He reports directly to the
Chief Executive Officer. In addition, he maintains a reporting
A key organizational pillar of governance in the line to the Chairman of the Supervisory Board and regularly
Schaeffler Group is the “Group Compliance and Risk reports to the Chairman of the Audit Committee.
Committee” (GCRC) chaired by the Group Chief Compliance
Officer. The committee is made up of the heads of the The Schaeffler Group Code of Conduct and corporate policies
relevant governance functions (including compliance, law, on competition and antitrust compliance, anticorruption, the
internal control systems, internal auditing, and controlling) protection of confidential information, and against conflicts
and has the task of supporting the Executive Board in its of interest include requirements to prevent compliance
organizational duties with regard to compliance and risk violations. A compliance help desk continues to serve this
management. One of the main tasks of the GCRC is to purpose by providing advice on specific issues. In addition,
define interactions and to clearly delineate responsibilities Schaeffler has taken measures to detect any compliance
in order to avoid duplication. Furthermore, a consistent violations. These include audits and inspections as well as
and complete picture of the risk situation in all divisions, a global whistleblower system that also allows anonymous
functions and regions should be created on the basis of a reporting of alleged violations. As a part of the central
uniform evaluation and prioritization methodology. Another competence team at the headquarters in Herzogenaurach, the
goal is to develop risk reduction measures and monitor their “Forensics & Investigations” department is responsible for
implementation. Operationally, the GCRC is supported by the independent investigation of alleged violations.
the “Compliance & Risk Working Group”, which is composed
of representatives of the working level of the functions
represented in the GCRC. Compliance training
The elements of the governance structure – internal control With a systematic and target group-specific training program,
system and compliance and risk management system – work the company provides its employees with a necessary
together according to the internally recognized “Three Lines understanding of compliance issues. As part of web-based
of Defense Model”. The model assigns clear responsibilities training and face-to-face training, employees and executives
to manage risks that threaten the company’s existence are informed about the relevant requirements and made
or development. It is based on the principle that the aware of risks. Key areas of focus in 2018 included the
responsibility for a risk lies primarily with its originator. Code of Conduct, sales compliance, information security,Schaeffler Group | Sustainability Report 2018 SUSTAINABLE MANAGEMENT 30
2.1 Corporate governance
and protection against cybercrime and CEO fraud, a fraud Schaeffler Group information security measures are based on
scam that tricks companies into making payments by the ISO/IEC 27001 standard and take national and industry-
using false identities. The training courses are developed specific regulations into account. They are designed to protect
continuously and adapted to the areas of activity of the Schaeffler's intellectual property and the business secrets of
employees. 9,578 participants1) (prior year: 8,160) took part business partners from theft, loss, unauthorized disclosure,
in web-based training on compliance in the reporting period. unlawful access or misuse.
Furthermore, 8,793 employees (prior year: 8,741) were
trained in face-to-face training and workshops. Preventative measures to protect against cybercrime
in particular will be gradually expanded as part of the
Further information on the individual subsystems of the “Information & Cyber Security” program, among others,
governance structure and the compliance management system and accompanied by training and information offerings. In
of the Schaeffler Group can be found in the annual report 2018,
addition, a comprehensive “Information Security Training
page 101 et seq.
and Awareness Concept” was developed in 2018. It will be
introduced globally by 2020.
Due diligence processes: Systematically ensuring
In 2018, Schaeffler introduced an “IT Security by Design”
lawful behavior
process which is based on national and international
In order to systematically ensure the avoidance of legal and standards. It will ensure that IT security is already taken
reputational risks, the Schaeffler Group further strengthened into account when developing systems and applications.
its measures in the 2018 fiscal year. The expansion of a Corresponding protective measures are integrated in
competitor contact register was driven forward. The register the process depending on the protection requirements.
is already being used successfully at various pilot sites The global implementation of the “IT Security by Design”
worldwide. It promotes transparency and supports the process is planned in the regions for 2019.
pre-approval process for competitor contacts. In 2018, the
process was digitalized, which significantly speeds up the In 2018, Schaeffler also dedicated its compliance conference
further groupwide implementation. to the topic of information security and cyber security.
Compliance officers from Schaeffler regions around the world
In addition, an IT-based “Business Partner Due Diligence attended the conference. The conference not only focused
Workflow” was created. This workflow was integrated in the on the protection of their own data, but also about the
existing business process. This new process facilitates and development of an information security management system.
improves the business partner review. This workflow has been This system also includes managing risks in the supply chain
in use as part of a pilot project since 2018. and implements customer requirements.
Data protection, information, and IT security Business continuity and crisis management
Protecting personal rights is a high priority for Schaeffler In 2018, Schaeffler began combining and coordinating
and is a part of the Code of Conduct. The company handles business continuity activities at the Group level. Elements
the processing of data belonging to business partners such as effective emergency and crisis management have
and employees with the greatest care and sensitivity. been established. A unified approach to a business impact
The corresponding processes comply with the respective analysis has been created and will be piloted in a plant in
data protection requirements. In 2018, these processes China in 2019. The introduction into relevant business areas
were further improved with regard to the requirements of will take place until 2021. Continuous measures for training
the EU General Data Protection Regulation (EU GDPR) in and practice prepare the members of the crisis staff to deal
particular. The data protection officer at Schaeffler AG plays with crisis situations.
a central managing role. He is assigned to the “Compliance
& Corporate Security” department and thus to the Chief
Executive Officer's division. GRI 102-11 | 102-15 | 102-17 | 102-18 | 205-2 | 410-1
UNGC 1-10
1) Employees incl. temporary staff, apprentices, interns, and contract workers.You can also read
